Updated 04:06 AM EST, Wed, Dec 02, 2020

T-Mobile Buys Certain 700MHz A-Block Spectrum Licenses from Verizon Wireless Worth Billions, What the Agreement Means?

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T-Mobile has paid Verizon Wireless billions for an agreement to purchase spectrum licenses from the top mobile carrier in the United States.

The fourth-largest mobile in the U.S., T-Mobile agreed to pay $2.365 billion in cash as well as transfer some AWS and PCS spectrum licenses worth approximately $950 million in exchange for certain 700MHz A-Block spectrum licenses from Verizon Wireless.

With the deal, T-Mobile will reportedly hold "important low-band spectrum" in nine of the top 10 markets across the U.S. as well as 21 of the top 30 markets. The spectrum purchase will give T-Mobile coverage to approximately 158 million people including Atlanta, Dallas, Detroit, Houston, Los Angeles, New York, Philadelphia, and Washington D.C.

"This is a great opportunity to secure low-band spectrum in many of the top markets in America," said T-Mobile President and CEO John Legere. "These transactions represent our biggest move yet in a series of initiatives that are rapidly expanding our already lightning fast network and improving its performance across the country."

The T-Mobile CEO added that the mobile carrier will continue to find ways to develop its customers' network experience along with their "bold" un-carrier efforts that "have shaken up the wireless industry to benefit consumers."

The low-band spectrums provide better in-building coverage particularly in rural areas. Low-band spectrums also travel greater distances than high-band spectrums, therefore, providing cellular coverage in less densely populated areas.

The additional coverage comes after T-Mobile launched its nationwide 4G LTE network in 2013, which covers approximately 209 million people in 273 main cities.

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